- According to the U.S. Census Bureau, 201 million people were covered under private health care plans in 2008 while 87 million had coverage through government sponsored health plans. Indemnity health insurance plans are considered traditional health plans because they are the oldest known type of plan. Managed health care has three main plan types: health maintenance organization (HMO), point of service (POS) and preferred provider organization (PPO). In 2010, more than 138 million people had coverage by way of managed health care, which is up from 126 million in 2009, according to the Kaiser Family Foundation.
- HMO plans provide its members with the highest amount of insurance benefits of all three managed health care but are the most restrictive. Each member is given a list of doctors in their location (provider network) who are contracted to provide medical services at lower rates in return for clients. HMO members must choose their primary care physicians from this group. PCPs are in charge of their patient's medical care and coordinate their health care services. Members are required to use their PCPs and their provider networks to receive medical services. In return, they typically pay no deductibles and have low co-pay amounts. If members decide to go out of network for care, they need referrals from their PCPs or will not receive insurance coverage unless it is an emergency.
- Of the three managed health care plans, PPO plans provide their members with the most flexibility and control over their medical decisions. PPO members do not have to have to choose a PCP or use their provider network for medical services. They are able to choose a doctor outside of their network and still receive insurance benefits. Members pay more out of pocket when receiving in-network care than HMO members and have higher deductible and co-pay amounts but these costs increase substantially when they go out of network. For example, members are reimbursed up to 90 percent for in-network care but only 60 percent for non-network services, according to AgencyInfo.
- POS plans are considered hybrids of PPO and HMO plans. POS members are provided with a network of physicians who they can get health care from and receive higher insurance benefits. Some POS plans are run similar to HMO plans by requiring members to choose PCPs to manage their medical care, but like PPO plans, members are able to go out of network as well and still maintain insurance coverage. Their insurance benefits will be lower, causing them to pay more out of pocket as a result.
- Individuals and families who are looking for maximum control over their health care decisions can choose indemnity health plans. These plans are considered fee-for-service plans as they reimburse members after services have been provided. Indemnity health plans do not provide their members with physician networks or require them to choose PCPs. Insureds are able to go to any doctor of their choice with no limitations on locations or costs. For all of the choices given to members, indemnity health plans are generally more expensive than managed health care plans.
- Government-sponsored health plans such as Medicaid and Medicare are available to every U.S. citizen. Applicants must meet certain requirements to prove their eligibility. Medicaid is a federal program run by states that cover those who are considered low income or have disabilities. Medicare provides health care to America's older population. Individuals are eligible if they are 65 years of age or older, under 65 years of age and have disabilities or individuals who suffer from end-stage renal failure (kidney disease). Two main parts to Medicare are Part A and Part B. Part A, which is free to Medicare recipients, covers hospice care, inpatient services and skilled nursing care. Part B, which requires monthly premiums, covers regular doctor visits and outpatient services.
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